Asure Software (NASDAQ: ASUR), a leading provider of workforce
management software, today reiterated that stockholders should not
be deceived by the misleading statements, most recently reflected
in the release issued June 29, 2009, by Red Oak Partners and the
Pinnacle Fund, a group of dissident stockholders who are attempting
to gain control of the Company by means of a hostile proxy contest.
"We are deeply concerned and disappointed that Red Oak Partners,
Pinnacle Fund and its portfolio manager, David Sandberg, are again
perpetuating misperceptions and spreading false allegations about a
company -- in this case Asure Software -- in an attempt to gain
unwarranted support for their effort to take control of the Company
without paying a premium," said Nancy L. Harris, President and
Chief Executive Officer.
"We have in good faith tried numerous times to meet with
Pinnacle/Red Oak and the members of their proposed slate to learn
more about their individual qualifications as potential directors
and managers of your company as well as their plans for improving
Asure's profitability and increasing stockholder value," Harris
said. "The fact that this group has failed to put forth any plan
for taking the company to profitability and increasing stockholder
value should be alarming to all stockholders, especially given
Pinnacle/Red Oak's lack of experience with Asure's business and
with public companies in general and their history of contentious
litigation in connection with their earlier hostile takeover
attempts. We can only conclude that they have no plan other than
the pursuit of a self-serving, short-term agenda that is not in the
best interests of Asure's shareholders."
In this vein, on February 17, 2009, CLST Holdings, Inc.
announced that it had filed a lawsuit in the United States District
Court for the Northern District of Texas against Red Oak Fund,
L.P., Red Oak Partners, LLC, and David Sandberg, alleging the
defendants violated federal securities laws by making recent
purchases of the common stock of CLST. Among other things, CLST
accused the defendants of falsely stating their intention to
abandon a previously announced tender offer for CLST's common stock
while proceeding with an illegal tender offer that did not comply
with applicable securities laws. CLST has also accused the
defendants of failing to make timely disclosure of their stock
purchases in light of their undisclosed tender offer.
"Our current Board of Directors and management team are
diligently committed to long-term value creation with a plan to get
the Company to break-even this year and continue our profitable
growth in the workforce management market," said Harris. "We have
made great headway since the acquisition of iEmployee in the fall
of 2007, and we are in an excellent position to grow that business
so that it generates long-term value for shareholders."
The Company also will send the following letter, dated July 1,
2009, to all stockholders:
Dear Fellow Stockholder:
Red Oak Partners, a New York-based hedge fund with a reputation
for aggressively attacking companies for short-term gains, has
stated its intent through its affiliate, The Pinnacle Fund, to wage
a proxy contest for control of your company by replacing Asure
Software's existing Board of Directors with its own slate of six
directors of questionable background, experience and
qualifications. This unproductive and costly proxy contest comes at
a time when the company can ill afford to be distracted from
continuing to implement its transformational growth strategy.
The Board of Directors strongly urges Asure Software
stockholders not to take any action in response to the dissident
proxy material and not to sign any proxy cards you might receive
from Pinnacle/Red Oak.
We believe Pinnacle/Red Oak is attempting to seize control of
your company without paying for it, a deceptive tactic we have seen
them use in other proxy contests.
Since Pinnacle/Red Oak is using questionable tactics, misleading
comments and unproven assertions, we are writing to ensure you have
all the facts with respect to the following:
Pinnacle/Red Oak's actions show that it is pursuing a
self-serving, short-term agenda that is not in the best interests
of Asure's shareholders.
-- Pinnacle/Red Oak has opportunistically increased its stake in the
company by acquiring shares at a historically low price, with the apparent
intent of gaining control of the Board without paying a premium and at the
expense of long-term value creation for investors. It has provided no
strategic plan that would be superior to the company's ongoing long-term
strategy.
-- We have found Pinnacle/Red Oak to be disingenuous in its
communications with Asure shareholders, publicly stating several times that
it did not desire to have Board representation, and then proceeding with a
proxy contest. They have also rejected your Board's good-faith efforts to
engage them in discussions that could have led to a compromise to avoid
this proxy fight. Frankly, their inconsistent communications with the
company indicate they lack true understanding of the business and our
rapidly evolving markets.
Asure Software has reported solid performance in recent quarters
and completely transformed its business in the past six years.
-- Under the current Board's leadership since 2003, we have successfully
integrated two strategic acquisitions -- NetSimplicity and iEmployee --
that serve high-growth, high-margin markets. We also divested the legacy
businesses that were facing eroding market demand and relevancy. Since we
started this transformation, we have eliminated 93% of expenses from the
company.
-- Despite the recent harsh macroeconomic environment, we have reported
solid financial and operational results in recent quarters and have
outperformed our competitors. For example, iEmployee new customer bookings
grew 59% in the fiscal 2009 third quarter, and we further reduced expenses
by 11%, including a 10% pay cut across the company.
-- In the short term, we expect to get to break-even by the end of our
October quarter by further reducing our operational expenses. In the long
term, we will continue pursuing our vision of being the leading provider of
on-demand workforce management software solutions to small and mid-sized
companies. We expect rapid profitable growth when the economy and our
target markets rebound, with our objective to reach $30 million in revenues
and 10% profit exiting fiscal 2013 (top-line CAGR of approximately 30%).
Your Board has a track record of transparency, strong corporate
governance and listening to all shareholders, not just a chosen few
with self-serving agendas.
-- Your Board has done its prudent due diligence in reviewing all
possible strategic alternatives for long-term value creation, and has acted
independently according to best practices of corporate governance, with the
assistance of outside advisors. The Board and management team continue to
work toward aggressively reducing expenses, growing revenue and
profitability, and creating shareholder value.
-- In June 2009, the Board implemented a seamless management transition
plan by appointing former Chief Operating Officer Nancy L. Harris to
President and Chief Executive Officer, and naming her to fill the vacancy
of a director who had stepped down. Ms. Harris brings exceptional
leadership skills and experience to the position, along with a forward-
looking vision focused on increasing shareholder value by growing revenues
through innovative software and service solutions, optimizing our
distinctive brands, and continuing to reduce costs and improve operational
efficiency. This appointment effectively separates the positions of
Chairman and CEO, with former Chairman and CEO Richard N. Snyder continuing
as Executive Chairman. Ms. Harris has been integral to the company's
progress during the past eight years, as she led the integration and growth
of our two acquired software businesses -- NetSimplicity and iEmployee.
Based on our knowledge of the dissident slate, the Pinnacle/Red
Oak nominees appear to be either conflicted, lack an understanding
of the company's business or have questionable backgrounds.
The dissident's slate includes:
-- David Sandberg, managing member and founder of Red Oak, whose minimal
public company board experience consists of his recent appointments to the
boards of SMTC and EDCI.
-- Adrian Pertierra, senior analyst at Red Oak, with no known public
company, operational or director experience.
-- Bob Graham and Pat Goepel, both former board members of iEmployee
prior to its acquisition by Asure.
It is doubtful that the limited and conflicted perspectives of
these individuals in combination with the two other dissident
nominees -- Cornelius Ferris and Jeffrey Vogel -- would be
sufficient to make up an effective Board. For example, we have no
knowledge that any of these dissident nominees is qualified to
chair an audit committee, or has firsthand knowledge of securities
law and Sarbanes-Oxley requirements. Moreover, earlier this year,
CLST Holdings sued Red Oak Partners, its affiliates and David
Sandberg over alleged violations of securities laws.
Our Board-recommended slate of directors provides seasoned
public company and relevant tech industry experience and has upheld
the highest levels of corporate governance standards while
successfully guiding the company through its transformation.
In addition to Ms. Harris, our director nominees are:
-- Chairman Richard N. Snyder, who has more than 30 years of direct
experience in all aspects of the computer industry. Mr. Snyder was
responsible for launching and managing the inkjet printing business and
creating the Deskjet brand for Hewlett Packard, where he served for 28
years. He also held senior management positions at Dell and Compaq, and
founded a consulting firm for high-technology businesses. He sits on the
Board of Directors of Symmetricom (SYMM), where he has served on the Audit
and Compensation committees.
-- James H. Wells, a consultant for Internet start-up companies; former
senior vice president of marketing and business development for Dazel, a
Hewlett Packard enterprise software company; and founding officer of the
Internet streaming company RealNetworks, Inc.
-- Lou Mazzucchelli, a partner with venture capital firm Ridgewood
Capital which focuses on the information technology industry; former
investment banker and digital media technology analyst for Gerard Klauer
Mattison; and founder of Cadre Technologies, a pioneering computer-aided
software engineering tools company.
-- Richard J. Agnich, an advisor to technology start-ups; trustee of
Austin College and chair of the Entrepreneurs Foundation of North Texas;
and former Senior Vice President, General Counsel and Secretary at Texas
Instruments.
-- Ray R. Miles, a corporate strategic consultant for Rajko Associates;
former President of Communications Services with EDS, Inc.; and former
manager of software strategy at Texas Instruments.
Your independent Board and management team are focused solely on
delivering steadily increasing financial and operational
performance and will remain responsible to all investors while
continuing to aggressively evaluate growth strategies and
value-creating opportunities.
Your Board of Directors unanimously recommends that an
affirmative vote be cast "for" each of our director nominees and
"for" each of the other proposals listed on the white proxy card.
The Board urges you not to sign or return any proxy card sent to
you by Pinnacle/Red Oak.
Sincerely,
Nancy L. Harris
President, Chief Executive Officer and Director
About Asure Software
Headquartered in Austin, Texas, Asure Software (NASDAQ: ASUR) (a
d/b/a of Forgent Networks, Inc.), empowers small to mid-size
organizations and divisions of large enterprises to operate more
efficiently, increase worker productivity and reduce costs through
a comprehensive suite of on-demand workforce management software
and services. Asure's market-leading suite includes products that
optimize workforce time and attendance tracking, benefits
enrollment and tracking, pay stubs and W2 documentation, expense
management, and meeting and event management. With additional
offices in Warwick, Rhode Island; Vancouver, British Columbia; and
Mumbai, India; Asure serves 3,500 customers around the world. For
more information, please visit www.asuresoftware.com.
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995:
Statements in this press release regarding Asure's business
which are not historical facts are "forward-looking statements"
that involve risks and uncertainties. Such risks and uncertainties,
which include those associated with continued listing of the
Company's securities on the NASDAQ Capital Market, could cause
actual results to differ from those contained in the
forward-looking statements.
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